Exam 10: Aggregate Demand I

Consider a closed economy to which the Keynesian-cross analysis applies.Consumption is given by the equation C = 200 + 2/3(Y - T).Planned investment is 300,as are government spending and taxes.a.If Y is 1,500,what is planned spending? What is inventory accumulation or decumulation? Should equilibrium Y be higher or lower than 1,500? b.What is equilibrium Y? (Hint: Substitute the values of equations for planned consumption,investment,and government spending into the equation Y = C + I + G and then solve for Y.) c.What are equilibrium consumption,private saving,public saving,and national saving? d.How much does equilibrium income decrease when G is reduced to 200? What is the multiplier for government spending?

(Essay)

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Question 41

The equilibrium condition in the Keynesian-cross analysis in a closed economy is:

(Multiple Choice)

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Question 42

One argument in favour of tax cuts over spending on infrastructure to increase production is that:

(Multiple Choice)

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Question 43

According to the theory of liquidity preference,holding the supply of real money balances constant,an increase in income will the demand for real money balances and will the interest rate.

(Multiple Choice)

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Question 44

Changes in monetary policy shift the:

(Multiple Choice)

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Question 45

If the IS curve is given by Y = 1,700 - 100r and the LM curve is given by Y = 500 + 100r,then equilibrium income and interest rate are given by:

(Multiple Choice)

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Question 46

The IS curve shifts when all of the following economic variables change except:

(Multiple Choice)

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Question 47

The LM curve shows combinations of ______ that are consistent with equilibrium in the market for real money balances:

(Multiple Choice)

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Question 48

Along any given IS curve:

(Multiple Choice)

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Question 49

An increase in government spending generally shifts the IS curve,drawn with income along the horizontal axis and the interest rate along the vertical axis:

(Multiple Choice)

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Question 50

If investment does not depend on the interest rate,then the curve is .

(Multiple Choice)

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Question 51

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y₁,then inventories will inducing firms to production.

(Multiple Choice)

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Question 52

At a given interest rate,an increase in the nominal money supply ______ the level of income that is consistent with equilibrium in the market for real balances.

(Multiple Choice)

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Question 53

John Maynard Keynes wrote that responsibility for low income and high unemployment in economic downturns should be placed on:

(Multiple Choice)

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Question 54

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y₃,then inventories will inducing firms to production.

(Multiple Choice)

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Question 55

The IS curve generally determines:

(Multiple Choice)

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Question 56

A decrease in confidence in stocks and bonds will lead households to shift their portfolios.As far as the money market is concerned,this development raises money and the equilibrium interest rate.

(Multiple Choice)

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Question 57

The intersection of the IS and LM curves determines the values of:

(Multiple Choice)

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Question 58

The tax multiplier indicates how much ______ change(s)in response to a $1 change in taxes.

(Multiple Choice)

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Question 59

The IS-LM model simultaneously determines equilibrium in two markets.a.Which two markets? b.What two variables adjust to bring equilibrium in the markets?

(Essay)

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Question 60

Showing 41 - 60 of 142

The equilibrium condition in the Keynesian-cross analysis in a closed economy is:

One argument in favour of tax cuts over spending on infrastructure to increase production is that:

According to the theory of liquidity preference,holding the supply of real money balances constant,an increase in income will the demand for real money balances and will the interest rate.

Changes in monetary policy shift the:

If the IS curve is given by Y = 1,700 - 100r and the LM curve is given by Y = 500 + 100r,then equilibrium income and interest rate are given by:

The IS curve shifts when all of the following economic variables change except:

The LM curve shows combinations of ______ that are consistent with equilibrium in the market for real money balances:

Along any given IS curve:

An increase in government spending generally shifts the IS curve,drawn with income along the horizontal axis and the interest rate along the vertical axis:

If investment does not depend on the interest rate,then the curve is .

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y₁,then inventories will inducing firms to production.

At a given interest rate,an increase in the nominal money supply ______ the level of income that is consistent with equilibrium in the market for real balances.

John Maynard Keynes wrote that responsibility for low income and high unemployment in economic downturns should be placed on:

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y₃,then inventories will inducing firms to production.

The IS curve generally determines:

A decrease in confidence in stocks and bonds will lead households to shift their portfolios.As far as the money market is concerned,this development raises money and the equilibrium interest rate.

The intersection of the IS and LM curves determines the values of:

The tax multiplier indicates how much ______ change(s)in response to a $1 change in taxes.

The IS-LM model simultaneously determines equilibrium in two markets.a.Which two markets? b.What two variables adjust to bring equilibrium in the markets?

The Science of Macroeconomics

The Data of Macroeconomics

The Open Economy

Unemployment

Economic Growth I

Economic Growth II

Introduction to Economic Fluctuations

Aggregate Supply and the Short-Run

Stabilization Policy

Government Debt and Budget Deficits

Investment

Money Supply and Money Demand

The Financial System

Filters

Exam 10: Aggregate Demand I

The equilibrium condition in the Keynesian-cross analysis in a closed economy is:

One argument in favour of tax cuts over spending on infrastructure to increase production is that:

According to the theory of liquidity preference,holding the supply of real money balances constant,an increase in income will ______ the demand for real money balances and will ______ the interest rate.

Changes in monetary policy shift the:

If the IS curve is given by Y = 1,700 - 100r and the LM curve is given by Y = 500 + 100r,then equilibrium income and interest rate are given by:

The IS curve shifts when all of the following economic variables change except:

The LM curve shows combinations of ______ that are consistent with equilibrium in the market for real money balances:

Along any given IS curve:

An increase in government spending generally shifts the IS curve,drawn with income along the horizontal axis and the interest rate along the vertical axis:

If investment does not depend on the interest rate,then the ______ curve is ______.

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y1,then inventories will ______ inducing firms to ______ production.

At a given interest rate,an increase in the nominal money supply ______ the level of income that is consistent with equilibrium in the market for real balances.

John Maynard Keynes wrote that responsibility for low income and high unemployment in economic downturns should be placed on:

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y3,then inventories will ______ inducing firms to ______ production.

The IS curve generally determines:

A decrease in confidence in stocks and bonds will lead households to shift their portfolios.As far as the money market is concerned,this development raises money ______ and ______ the equilibrium interest rate.

The intersection of the IS and LM curves determines the values of:

The tax multiplier indicates how much ______ change(s)in response to a $1 change in taxes.

The IS-LM model simultaneously determines equilibrium in two markets.a.Which two markets? b.What two variables adjust to bring equilibrium in the markets?

The Science of Macroeconomics

The Data of Macroeconomics

The Open Economy

Unemployment

Economic Growth I

Economic Growth II

Introduction to Economic Fluctuations

Aggregate Supply and the Short-Run

Stabilization Policy

Government Debt and Budget Deficits

Investment

Money Supply and Money Demand

The Financial System

Filters

According to the theory of liquidity preference,holding the supply of real money balances constant,an increase in income will the demand for real money balances and will the interest rate.

If investment does not depend on the interest rate,then the curve is .

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y₁,then inventories will inducing firms to production.

Use the following to answer questions : Exhibit: Keynesian Cross -(Exhibit: Keynesian Cross)In this graph,if firms are producing at level Y₃,then inventories will inducing firms to production.

A decrease in confidence in stocks and bonds will lead households to shift their portfolios.As far as the money market is concerned,this development raises money and the equilibrium interest rate.